Kingfisher plcKingfisher plchalf year results

18 September 2019

6 months to 31 July 2019

2

Disclaimer

You are not to construe the content of this presentation as investment, legal or tax advice and you should make you own evaluation of the Company and the market. If you are in any doubt about the contents of this presentation or the action you should take, you should consult a person authorised under the Financial Services and Markets Act 2000 (as amended) (or if you are a person outside the UK, otherwise duly qualified in your jurisdiction).

This presentation has been prepared in connection with the announcement of the financial results for the six months ended 31 July 2019. The financial information referenced in this presentation is not audited and does not contain sufficient detail to allow a full understanding of the financial performance of the Group. For more information, the entire text of the announcement for the six months ended 31 July 2019 can be found on the Investor Relations section of the Company’s website. Nothing in this presentation should be construed as either an offer or invitation to sell or any offering of securities or any invitation or inducement to any person to underwrite, subscribe for or otherwise acquire securities in any company within the Group or an invitation or inducement to engage in investment activity under section 21 of the Financial Services and Markets Act 2000 (as amended).

This presentation is being solely made and directed at persons to whom this presentation may lawfully be communicated (“relevant persons”). Any person who is not a relevant person should not act or rely on this presentation or any of its contents.

Certain information contained in this presentation may constitute “forward-looking statements” (including within the meaning of the safe harbour provisions of the United States Private Securities Litigation Reform Act of 1995), which can be identified by the use of terms such as “may”, “will”, “would”, “could”, “should”, “expect”, “anticipate”, “project”, “estimate”, “intend”, “continue”, “target”, “plan”, “goal”, “aim” or “believe” (or the negatives thereof) or other variations thereon or comparable terminology. These forward-looking statements include all matters that are not historical facts and include statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, changes in global or regional trade conditions, changes in tax rates, liquidity, prospects, growth and strategies. By their nature, forward-looking statements involve risks, assumptions and uncertainties that could cause actual events or results or actual performance of the Company to differ materially from those reflected or contemplated in such forward-looking statements. No representation or warranty is made as to the achievement or reasonableness of, and no reliance should be placed on, such forward-looking statements.

The Company does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances or in the Company’s expectations.

3

Welcome & introduction

Andy Cosslett, Chairman

44

Key point summary Transformation activity continued across the Group

H1 financial performance mixed: - Continued sales growth at Screwfix, Poland and Romania- Significant unified range change adversely impacted B&Q- Transformation activity causing disruption and operational challenges at Castorama France- Price repositioning at Brico Dépôt France; increased gross profit year on year- Good digital sales growth across the Group

H1 Group gross margin % up 60bps, with Group gross profit also up, driven by sourcing benefits and price repositioning- Unified offer sales up 0.4% and gross margin % up 150bps

Balance sheet remains strong

Strong new leadership; opportunity to add new skills to executive team and build a stronger Kingfisher

55

Engagement score (79) top quartile, stable and significantly higher than retail benchmark (66)

Overall price index improving

Net Promoter Score (NPS) improving in every market

Offer

Digital

Customers

59% of sales unified (H1 18/19: 42%); sales from unified ranges up

Sourcing benefits driving growth of gross margin % from unified ranges

Increasing focus on differentiated (unique) products

Digital sales now 7% of Group sales (FY 18/19: 6%)

Digital sales growth +18% (click & collect +24%)(1)

Growth in website conversion rates and digital penetration in all Opcos

H1 19/20 highlights

Colleagues

(1) Variance in constant currencies

6

H1 2019/20 financial results

John Wartig, Interim CFO

77

H1 19/20 summary income statement£m (reported unless otherwise stated) H1 19/20 H1 18/19(1) Change YOYSales 5,997 6,080 (0.9)%

Gross profit 2,221 2,216 +0.6%

Gross margin (%) 37.0% 36.4% +60bps

Retail profit(2) 466 490 (4.4)%

Underlying PBT(2) 353 377 (6.4)%

Adjusted PBT(3) 337 325 +3.7%

Statutory PBT 245 280 (12.5)%

Adjusted effective tax rate (%)(3) 26% 27% 1%

Underlying basic EPS (p)(2) 12.3 12.8 (3.9)%

Adjusted basic EPS (p)(3) 11.8 11.0 +7.3%

Statutory EPS (p) 8.1 9.6 (15.6)%

Dividend (p) 3.33 3.33 -(1) The Group adopted IFRS 16 ‘Leases’ on 1 February 2019 on a fully retrospective basis, resulting in the restatement of comparatives for the six months ended 31 July 2018 and year ended 31 January 2019(2) Before P&L transformation costs, exceptional items, lease FX, related tax items and tax on prior year items (3) Before exceptional items, lease FX, related tax items and tax on prior year items

Variance in constant currencies

88

£m (unless otherwise stated) H1 19/20 H1 18/19(1) Comments on H1 19/20

Underlying PBT 353 377

Transformation P&L costs (16) (52) Principally relates to U&U range implementation and digital transformation initiatives

Adjusted PBT 337 325

Transformation exceptional costs - (46) Prior period costs relate to people changes associated with restructuring in France & UK

Store closures (68) 4 Mainly redundancy provisions related to store closures in France and Germany

Russia & Iberia (26) - Mainly store impairments in Russia

Gain on disposal of properties 1 -

Total exceptional items before tax (93) (42)

Exchange gains/(losses) on lease liabilities 1 (3)

Statutory PBT 245 280

H1 19/20 transformation costs and exceptional items

(1) The Group adopted IFRS 16 ‘Leases’ on 1 February 2019 on a fully retrospective basis, resulting in the restatement of comparatives for the six months ended 31 July 2018 and year ended 31 January 2019

99

H1 19/20 group operational summary

UK & Ireland (44% of sales)

LFL (0.7)%

GM % +60bps

Retail profit (1.7)%

France (36% of sales)

LFL (4.4)%

GM % +60bps

Retail profit (12.2)%

Retail profit movement % is in constant currency; retail loss represents reported retail loss in H1 19/20

Poland (13% of sales)

LFL +3.3%

GM % (20)bps

Retail profit (0.5)%

Other (7% of sales)

LFL (2.8)%

Retail loss £(13)m

1010

UK & Ireland (44% of sales, 59% of RP)

LFL (0.7)%GM +60bpsRP (1.7)%

B&Q LFL -3.2%

c. -2% LFL impact from discontinuation of installation services Surfaces & Décor and Kitchens impacted by ongoing new range

implementation; Outdoor impacted by strong weather comparative Modest benefit from competitor store closures Digital sales +10% growth; 5% of total B&Q sales

Gross margin % up reflecting sourcing benefits and discontinuation of installation services; anticipate H2 kitchens clearance impact

Cost increase largely reflects wage inflation and digital costs

Screwfix LFL +5.1% - selective ongoing investment in price; continuing to gain

market share Digital sales +18% growth; 32% of total Screwfix sales Opened 16 new stores during H1; FY store opening target on track including

first stores in the Republic of Ireland

UK & Ireland – significant range change at B&Q; continued market share growth at Screwfix

RP = retail profit; RP movement % is in constant currency

1111

Castorama LFL -4.3% reflecting price repositioning (c. -2% LFL impact) and

transformation-related activity (c. -2% LFL impact) Digital sales (1) +19% growth; 2% of total Castorama France sales Gross margin % continues to be impacted by logistics & stock inefficiencies

Brico Dépôt LFL -4.6% driven by price repositioning, following a reduction in lower margin

promotional activity (“arrivages”) (c. -5% LFL impact) Digital sales(1) +30% growth; 2% of total Brico Dépôt sales Gross profit and gross margin % up, year on year in H1

France – price repositioning driving gross margin % uplift at Brico Dépôt; Castorama underperformingFrance (36% of sales, 24% of RP)

LFL (4.4)%GM +60bpsRP (12.2)%

RP = retail profit; RP movement % is in constant currency(1) Variance in constant currencies

1212

Overall change programme causing issues in stock planning, stock management and logistics processes

Digital & Supply Chain

Improve effectiveness of IT platform

Improve stock planning and management processes to support better availability

Improve fulfilment efficiency Enhance ecommerce

capability

Castorama France – update

Unified c. 60% of product ranges Price index at 101

Price perception continuing to improve NPS improved c. 5pts over last 12 months

After consultations, closing nine Castorama stores over next 18 months

Benefits in H1 include move to finance shared services in H2 last year

Offer

Customer

Stores

Costs

Where we are today

Execution focus

1313

Poland – solid performance; Romania – in transition

Poland (13% of sales, 19% of RP)

LFL +3.3%GM (20)bpsRP (0.5)%

Good LFL sales performance; Sunday trading restrictions c. -1% impact to H1 LFL

All categories delivered positive LFL growth Digital sales(1) +52%; 2% of total sales Cost increase reflects wage inflation, digital costs and pre-opening costs

RP = retail profit; RP movement % is in constant currency; RL = retail loss(1) Variance in constant currencies

Romania (2% of sales)

LFL +10.5%RL £(8)m

Nearly all Praktiker stores now rebranded to Brico Dépôt with ranges significantly improved and expanding

Unified & unique ranges performing well Losses driven by former Praktiker stores Back-office integration planned for end of H2

1414

Iberia, Russia, Germany(6% of sales)

LFL (4.9)%RL(1) £(5)m

RL = retail loss(1) Includes Koçtaş, Kingfisher’s 50% JV in Turkey, which contributed £3m of retail profit in H1 19/20

Processes for Iberia and Russia progressingIberia LFL -3.6%; retail profit £3m

Russia LFL -6.9%; retail loss £(7)m

Screwfix Germany Retail loss £(4)m Closed all 19 stores during H1; retained online presence via

European website

Iberia, Russia & Germany

1515

Unified & unique outperforming non-unified

Unified & uniqueH1 sales growth(1)

+5.9%

+11.6%

(2.8)%

(2.2)%

(3.9)%

+4.8%

+8.6%28%

31%

51%

64%

66%

72%

81%

59%

72%

69%

49%

36%

34%

28%

19%

41%

Category 7

Category 6

Category 5

Category 4

Category 3

Category 2

Category 1

H1 19/20 sales split

Unified & unique+0.4%(1)

Non-unified(0.9)%(1)

Unified & uniqueH1 sales growth(1)

(2.8)%

+0.3%

+4.1%

+4.3%

(2.2)%

+2.9%

Flat

(1) Constant currency including clearance (excludes Iberia, Russia, Praktiker Romania, Screwfix Germany and services)(2) After cost price inflation and price investment; before logistics & stock inefficiencies

Sales growth

Unified & uniquegross profit growth(1)(2)

1616

H1 18/19Group gross

margin

Unified &unique

Non-unified Pricerepositioning

Discont'n ofinstallations

(B&Q)

Clearance Logistics &stock

inefficiencies

H1 19/20Group gross

margin

+80bps +0bps

36.4%

37.0%

(30)bps

After cost price inflation & price investment

(40)bps

+30bps

+20bps

Unified & unique and price repositioning benefits partly offset by clearance and inefficiencies

(3)

(1) After cost price inflation and price investment; before clearance and logistics & stock inefficiencies(2) 59% product (COGS) unified on average in H1 18/19; exit rate 63%(3) Gross margin % in constant currency

+c. 150bps GM benefit(1)

on 59%(2) of COGS unified

(mainly Castorama France)

(mainly Brico Dépôt France)

1717

H1 19/20 summary cash flow and net debt

131

695

204 84

(236)

(45) (47)

(163) (157)

EBITDA Net rent paid Change inworkingcapital

Tax, interest &other

Gross capex Free cash flow Disposals &other

Dividend H1 19/20movement in

cash

£m

H1 19/20 FY 18/19

IFRS 16 lease liabilities 2,638 2,626

Borrowings & other 131 145

Cash (385) (229)

Net debt 2,384 2,542

Net debt to EBITDA 1.8x(2) 2.0x

£m

(1) The Group adopted IFRS 16 ‘Leases’ on 1 February 2019 on a fully retrospective basis, resulting in the restatement of comparatives for the six months ended 31 July 2018 and year ended 31 January 2019(2) Net debt to last twelve months’ EBITDA

Change in stock: -£111m Net change in

debtors/creditors: +£66m

1818

Gross margin

Sales outlook

Costs

Central costs expected to be up to c. £55m (previously c. £50m) Total transformation costs over 5 years to FY 20/21 expected to be less than £800m

Transformation P&L costs expected to be c. £50-60m in FY 19/20 (previously c. £60-80m) Transformation exceptional costs in FY 19/20 expected to be up to c. £40m

Continue to expect full year gross margin % after clearance to be flat(1)

c. £30-35m of incremental clearance costs (previously c. £25-30m), including B&Q kitchens in H2 19/20

UK – heightened level of uncertainty– annualising discontinuation of installations at B&Q at end of Q3 19/20

France – Castorama continues to underperform– Brico Dépôt annualising reduction in promotional activity at end of Q3 19/20

Poland – loss of one further Sunday of trading per month (3 non-trading Sundays; previously 2)

Other Continue to expect total capex (including transformation) of up to c. £375m 15 store closures over next 18 months, including 11 in France; cash costs expected to be

covered by store disposal proceeds

FY 19/20 outlook & technical guidance

(1) Gross margin movement excluding Russia and Iberia(2) Subject to the blend of profit within the companies’ various jurisdictions, as well as the timing of exits from Russia and Iberia

Tax Group adjusted effective tax rate expected to be around 26-27%(2)

1919

Impact of IFRS 16 ‘Leases’ Adopted full retrospective transition approach from 1 February 2019

No adverse impact on cash flows or underlying economics

Impact on income statement (non-cash) H1 18/19 FY 18/19

- Retail profit +£86m +£171m- Underlying pre-tax profit +£2m +£1m- Underlying EPS - -Impact on balance sheet- Right of use asset +£2,221m +£2,017m- Lease liability +£2,800m +£2,626m

FY 18/19 Net debt to EBITDA improved from 2.6x (under IAS 17(1)) to 2.0x (under IFRS 16) Reflecting lower IFRS 16 lease liability compared to 8x property operating lease rentals

assumption under IAS 17

H1 19/20 Net debt to last twelve months’ EBITDA of 1.8x

(1) Under IAS 17, the multiple was based on lease-adjusted net debt to EBITDAR

20

Tariffs & CustomsTariffs: zero-rate tariffs anticipated on most categories under a no-deal Brexit

Customs measures implemented to avoid delays

Working with vendors to manage transition

ProductsNo significant change to stock ahead of 31 October

Brexit and currency exposures

PeopleBrexit-related retention and hiring not a material issue to date

Managing foreign exchange risks

Of total annual COGS balance of c. £7bn, c. 20% is purchased directly in USD (around half of which relates to UK Opcos)

18-month rolling hedging programme in place to hedge all committed orders, along with a significant percentage of forecast net exposure, against changes in FX rates for USD and EUR

Current stock levels and tightly managed supplier agreements mitigate some of the residual FX-related CPI(1) risk (direct and indirect exposures)

Steps taken to manage Brexit risks

(1) CPI – Cost price inflation

2121

Financial summary

1H1 19/20 financial performance mixed

2Castorama France operational issues identified and focused workplan in place

3H1 19/20 Group gross margin % up 60bps driven by sourcing benefits and price repositioning

4Balance sheet remains strong

5Outlook for our main markets remains mixed

6Continue to expect gross margin % after clearance to be flat(1) in FY 19/20

(1) Group gross margin movement excluding Russia and Iberia

22

Building a stronger Kingfisher

Andy Cosslett, Chairman

2323

Improve performance of enabling technology and processes

Reduce disruption; wind down dual-running costs Tailor the change programme to better fit Opcos;

change ways of working and processes Seamless digital and supply chain interaction Further operating efficiencies

Leveraging the Group’s scale as a competitive advantage

Bring fresh perspective to strategy

Scale used intelligently for customer and wider business benefits

Product offerPricingDigital

Property & formatsCustomer service

Grow ScrewfixBalance of responsibilities between Centre/Opcos

Centralised offer,

design & sourcing

Unified IT Supply chain

GNFR & shared

services

New leadership to:

2424

Important new ranges landing this year

Bathroom & Storage (H1)

Surfaces & Décor (H1 & H2)

Kitchens (H2 in B&Q)

2525

Focus on improving execution

Complete implementation of key differentiated ranges (e.g. B&Q kitchens)

See through the implementation of key transformation enablers

Address underperformance of Castorama France

Continue active management of our property estate

Progress Russia and Iberia processes

Grow Screwfix in the UK and enter new markets

2626

Summary

Kingfisher is well positioned, with leading positions in markets that have attractive long-term growth potential

Transformation activity to support future growth continued across the Group in H1

Focus on improving execution to deliver customer and business benefits

Outlook for our main markets remains mixed; FY gross margin % expectation unchanged

Strong new leadership – Thierry Garnier joining on 25 September

Q&A

2828

Cautionary note regarding forward looking statements

Certain information contained in this presentation may constitute “forward-looking statements” (including within the meaning of the safe harbour provisions of the United States Private Securities Litigation Reform Act of 1995), which can be identified by the use of terms such as “may”, “will”, “would”, “could”, “should”, “expect”, “anticipate”, “project”, “estimate”, “intend”, “continue”, “target”, “plan”, “goal”, “aim” or “believe” (or the negatives thereof) or other variations thereon or comparable terminology. These forward-looking statements include all matters that are not historical facts and include statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, changes in global or regional trade conditions, changes in tax rates, liquidity, prospects, growth and strategies. By their nature, forward-looking statements involve risks, assumptions and uncertainties that could cause actual events or results or actual performance of the Company to differ materially from those reflected or contemplated in such forward-looking statements. No representation or warranty is made as to the achievement or reasonableness of and no reliance should be placed on such forward-looking statements.

The Company does not undertake any obligation to update or revise any forward-looking statement to reflect any change in circumstances or in the Company’s expectations.

Appendices

3030

Capex summary – H1 19/20 and guidance for FY 19/20

31%

3%10%

33%

4%

19%

H1 19/20:£163m

Existing stores

Screwfix expansion

New stores (ex-Screwfix)

IT

Other

Transformation

30%

5%

10%30%

5%

20%

FY 19/20 guidance:

up to £375m

Existing stores

Screwfix expansion

New stores (ex-Screwfix)

IT

Other

Transformation

3131

Net debt to EBITDA reconciliation

Moving annual total 2019/20 (£m) FY 2018/19 (£m)

Retail profit 900 924

Central costs (51) (49)

Transformation P&L costs (84) (120)

Depreciation and amortisation 544 535

EBITDA(1) 1,309 1,290

Net debt 2,384 2,542

Net debt to EBITDA 1.8x 2.0x

(1) Retail profit less central and transformation P&L costs, before depreciation and amortisation

3232

New YorkMichael O’Learyemail: michael.oleary@citi.comTel: +1 212 723 4483

LondonMike Woodsemail: michael.woods@citi.comTel: +44 (0) 20 7500 2030

For questions about Kingfisher ADRs, please contact Citi:

Benefits of ADRs to U.S. investors:

Clear and settle according to normal U.S. standards

Offer the convenience of stock quotes and dividend payments in U.S. dollars

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Kingfisher ADRs trade on OTCQX – the premier tier of the U.S. over-the-counter market under the following information:

Symbol KGFHY

CUSIP 495724403

Ratio 1 ADR : 2 ORDs

Country United Kingdom

Effective Date Jan 01, 1986

Underlying SEDOL 3319521

Underlying ISIN GB0033195214

Depositary Citi

ADR programme

3333

Investor Relations

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